Social Security - How do we fix it?

beachdweller

So some want it to go away, others to fix it in a number of ways, what needs to happen to fix it? Ideas?

My opinion, the only way to fix it is to make some hard decisions. I'm not sure when the 65 yr old number was put in place, but I believe it's been decades, if not from the start which actually may have been 62 yrs old. Our life expectancy has risen since then, and so if it was 70 yrs old when 65 yrs was put in place, and it's 74 (?) yrs now, why not raise the retirement age to 67, for example? Not popular, but tough decisions need to be made.

Will fixing our healthcare system, including medicare/caid help?

If we scrap the whole thing, what does that say about our society? Yes I know we aren't socialist, but all democracies are going to have socialist tendencies, and we have in thie matter for 60 to 70 yrs. If we are going to cut benefits, we might as well scrap it.

?

sponger

Invest it all in Ames AP1 Pearl Jam tour posters, and create a quota for PJ world tours and new albums so that there will always be a constant supply of new tour posters in which to invest social security funds.

You might then ask what will happen when PJ is too old to go to on world tours and write new albums?

pffft...as if the world would even exist after PJ.

decides2dream

i thought the 'official' age of retirement HAs already been raised to 67? i certainly could be mistaken though. i have no idea how to fix it....bt i definitely think it should be fixed, and not scrapped. i think it's a good safeguard, supplemental income, for those in retirement. no, it is NOT meant as a pension....but just one look at today's stock market, and thinking of the average citizen and their average investments...it's nice to know of something *solid* you can depend on at the age. just imo. so i DO hope they can 'fix' it.

jbalicki10

Anyone here feel that they will not be able to work all the way to 67? I think if I had to work to 67 I would just shoot myself. My dad now is pretty crippled at 66 right now. At least he got to reture at 55 and enjoy some years off.

TheDecline13

Its Easy Kill The OLD!

DriftingByTheStorm

beachdweller wrote:

I'm not sure when the 65 yr old number was put in place

ITS A GOVERNMENT CONSPIRACY!

source wrote:

Many Americans believe that Social Security is an integral part of our free enterprise system, but it is neither American nor free enterprise. The original Social Security system was created by the Prussian/German leader Otto von Bismarck in 1883. Bismarck was looking for a way to win the support of the working people, who were unhappy with the high taxes needed to support the large German military and the high prices created by the government-protected industrial cartels.

He wanted to find a way to con people into believing that they were going to get something from the state, without its actually having to deliver. He asked an actuary how long most people could be expected to live. The answer was 65 years. Bismarck then set the age of eligibility for his social security system at 65, knowing full well that most of the people would have died before they received a dime from the system. In spite of this, the system was wildly popular.

-source

TheVoiceInside

How bout this. Every person that has a college degree can have the option of using his SS money for investment puroses only. They can either use in the market to buy stocks or bonds. They might also use that money to invest in a property that will yield a profit by the time one retires. Those are just some ideas off the top of my head.

Any thoughts?

DriftingByTheStorm

TheVoiceInside wrote:

How bout this. Every person that has a college degree can have the option of using his SS money for investment puroses only. They can either use in the market to buy stocks or bonds. They might also use that money to invest in a property that will yield a profit by the time one retires. Those are just some ideas off the top of my head.

Any thoughts?

Yeah.
How about instead of being elitist about who gets to keep their money, we just let everyone keep their damn money.

I don't want the government telling me i have to give them money to save for my retirement, anymore than i want them telling me i have to give them money to pay for my healthcare.

It's MY money, it's MY health and MY retirement, I can handle it just fine.
Don't feed the animals.

TheVoiceInside

DriftingByTheStorm wrote:

Yeah.
How about instead of being elitist about who gets to keep their money, we just let everyone keep their damn money.

I don't want the government telling me i have to give them money to save for my retirement, anymore than i want them telling me i have to give them money to pay for my healthcare.

It's MY money, it's MY health and MY retirement, I can handle it just fine.
Don't feed the animals.

Hey just throwing it out there. I wasnt trying to be elitist. personally im with you I would like to keeep the money myself. The OP was asking for ideas and a gave a few. do with it what ever you want.

OutOfBreath

DriftingByTheStorm wrote:

ITS A GOVERNMENT CONSPIRACY!



-source

The age limit was initially set at 70, and the average age was 45. It wasn't meant to benefit all people. However, it must be seen in context with the rest of Bismarck's programs:

Wikipedia wrote:

Health Insurance Bill of 1883

The first bill that had success was the Health Insurance bill, which was passed in 1883. The program was considered the least important from Bismarck’s point of view, and the least politically troublesome. The program was established to provide health care for the largest segment of the German workers. The health service was established on a local basis, with the cost divided between employers and the employed. The employers contributed 1/3rd, while the workers contributed 2/3rds . The minimum payments for medical treatment and Sick Pay for up to 13 weeks were legally fixed. The individual local health bureaus were administered by a committee elected by the members of each bureau, and this move had the unintended effect of establishing a majority representation for the workers on account of their large financial contribution. This worked to the advantage of the Social Democrats who – through heavy Worker membership – achieved their first small foothold in public administration.[12]

[edit] Accident Insurance Bill of 1884

Bismarck’s government had to submit three draft bills before they could get one passed by the Reichstag in 1884. Bismarck had originally proposed that the Federal Government pay a portion of the Accident Insurance contribution. Bismarck’s motive was a demonstration of the willingness of the German government to lessen the hardship experienced by the German workers as a means of weaning them away from the various left-wing parties, most importantly the Social Democrats. The National Liberals took this program to be an expression of State Socialism, which they were dead set against. The Center party was afraid of the expansion of Federal Power at the expense of States Rights. As a result, the only way the program could be passed at all was for the entire expense to be underwritten by the Employers. To facilitate this, Bismarck arranged for the administration of this program to be placed in the hands of “Der Arbeitgeberverband in den beruflichen Korporationen”, which translates as “The organization of employers in occupational corporations”. This organization established central and bureaucratic insurance offices on the Federal, and in some cases the State level to perform the actual administration. The program kicked in to replace the health insurance program as of the 14th week. It paid for medical treatment and a Pension of up to 2/3rds of earned wages if the worker was fully disabled. This program was expanded in 1886 to include Agricultural workers.[12]

[edit] Old Age and Disability Insurance Bill of 1889

The Old Age Pension program, financed by a tax on workers, was designed to provide a pension annuity for workers who reached the age of 70 years. At the time, the life expectancy for the average Prussian was 45 years. Unlike the Accident Insurance and Health Insurance programs, this program covered Industrial, Agrarian, Artisans and Servants from the start. Also, unlike the other two programs, the principle that the Federal Government should contribute a portion of the underwriting cost, with the other two portions prorated accordingly, was accepted without question. The Disability Insurance program was intended to be used by those permanently disabled. This time, the State or Province supervised the programs directly.[12]

What Bismarck was aiming to do, was to take some of the wind that was gathering aoround labour/social democratic parties. And it worked nicely towards that purpose. This was in an age where socialist/communist revolution was a real and continous threat due to dissatified workers. (1840s onwards) By meeting the workers' demand in this manner, the situation in Germany stabilized.

As for the source you used, it didn't strike me as particularly objective, to say the least. And it is actually wrong about the fact you quoted.

Peace
Dan

jps176

DriftingByTheStorm wrote:

Yeah.
How about instead of being elitist about who gets to keep their money, we just let everyone keep their damn money.

I don't want the government telling me i have to give them money to save for my retirement, anymore than i want them telling me i have to give them money to pay for my healthcare.

It's MY money, it's MY health and MY retirement, I can handle it just fine.
Don't feed the animals.

Social security is NOT just a retirement progam, it is a saftey net for disabled people also.

And this MY, MY, MY thing... when are we gonna stop having that kind of attitude? Do you even understand why we pay taxes in the first place? It allows our society to function. I kind of like having paved roads, police and fire departments, court systems, public education, etc. etc... What ever happened to community and the idea of helping each other out? As far as investing social security in the stock mareket... seriously. Would you want your SS money in the market right now? I sure wouldn't. The fact is, social secuirty as a program is one of the most successful government progams there is... it has never failed to pay a check. Never. And despite all the hyper fear out there, it is pretty solvent. And I for one, like the idea of helping less fortunate/older people get along with the money I pay into it, because I know in turn when I get older, the next generation will do that for me... (along with my 401K).
As far as a solution... the problem isn't the structure of the program, it's the revenue it will need for the "baby boom" bubble. There is a fairly straightforward fix. As it satnds, you only pay social security tax on the first $90,000 you make. After that, you pay none. So, why not raise the cap to generate more cash for it? People that make over 90 grand a year (individual, not family) can kick a little more in, they're getting by just fine.

OutOfBreath

How does social security work in the US, anyone care to enlighten me?

I know how the norwegian and generally european ones work, but americans tend to have a twist in it. Here, it makes up about half of my taxes at least, and it goes to pensions, disabilities, unemployment etc etc. And it works "pay-as-you-go", in that the current workers pay for the current retirees/etc. There is also minimum requirements as to how long you must have been employed to be entitled to the whole package.

Does it work significantly different in the US? If not, the I would agree with the previous poster here.

Peace
Dan

dangerboy

wow.

first of all, the age slides now depending on when you were born. my mom's eligibilty age for full SS is like a year later than my dad's. neither can get full at 65...more like 66 and a half and 67.

when the original SS in america was put in place, the math worked. there were like 7 workers paying in to fund every 1 retiree. the math only worked for a generation or two, though, and now we're down to only 2 or 3 paying in to fund 1. eventually, it won't work. 1 person paying in cannot fund 1 person taking out.

the actual return on social security as an "investment" is something like a whopping 2 percent. 2 percent? i could bury that money in a can in my back yard for 40 years and make more than that off of it.

let me have mine. i can do better with it over the next 30 years than 2 percent, i guarantee that. if you people seriously think that the stock market will never rebound, you're insane. if you bought the index the day after the big crash in the late 80's, you'd still be up something like 1000% today. if you bought the index now and held it for 30 years....of course no one can predict the future, but the stock market is not a short term proposition, in spite of the flipper, day-trader, microwave, instant gratification culture we've propogated.

let me have mine. i'll buy some land. like my grandma always said "they ain't makin no more dirt".

speaking of my grandma, she lived until she was 89. i loved her. but she drew out every dollar she ever put into SS LONG before she died. like 15 years before she died. the rest was gravy. my grandfather didn't live to get more than a couple of years of his. so, i'm sure some would say it averages out. not even close. i did the math and she drew waaaaaayy more than the two of them had put in combined. i didn't begrudge her that money, because it was a promise made to her, and it needed to be kept. but the fact is that the math just doesn't work anymore.

and nobody is suggesting we take SS away from those currently collecting it. but for those of us who understand that it simply won't be there for us in 30, 40, 50 years, let us have ours. i say we can do better than the government has done with it for the last 75 years. it's your money. you loan it to the government for 50 years, and they pay it back in teeny tiny little pieces at an interest rate of 2 percent, with no guarantee that you'll ever actually get it all back. nobody in their right mind would make that loan on those terms.


mainly, it's my money. i want it to do with it what i think is best, not what some bloated batch of self-interested, vote-seeking, fat cats thinks is best


flame away

beachdweller

so we move to the policy taken by the city in "Logan's Run"?

yoke

TheVoiceInside wrote:

How bout this. Every person that has a college degree can have the option of using his SS money for investment puroses only. They can either use in the market to buy stocks or bonds. They might also use that money to invest in a property that will yield a profit by the time one retires. Those are just some ideas off the top of my head.

Any thoughts?

Bad idea...

Lesbelges

DriftingByTheStorm wrote:

It's MY money, it's MY health and MY retirement, I can handle it just fine.
Don't feed the animals.

Clearly, people are not responsible enough to manage their own finances as can be attested by the mortgage meltdown...

OutOfBreath

dangerboy wrote:

when the original SS in america was put in place, the math worked. there were like 7 workers paying in to fund every 1 retiree. the math only worked for a generation or two, though, and now we're down to only 2 or 3 paying in to fund 1. eventually, it won't work. 1 person paying in cannot fund 1 person taking out.

You must also factor in the increased productivity pr worker that has happened in the meantime. And not anytime soon will the ratio ever get near 1:1. Especially not in the US, which still have a growing population. There are some restructuring underway in Europe which are facing declining population the next decades.

Anyway, it's not the system that doesn't work, it just may need some tweaking. People live longer, maybe they should work longer to get the benefits. Not enough money, tweak the tax. Any increase like you describe would be temporary anyway. Once those boomers are out, it levels back off again.

dangerboy wrote:

and nobody is suggesting we take SS away from those currently collecting it. but for those of us who understand that it simply won't be there for us in 30, 40, 50 years, let us have ours.

How does that add up? It is precisely by taking your money today that those collecting today get their money. If you're talking about a cut-off point, then you'll essentially be charged double for the interim, by still paying off the current retirees, while having to start from scratch laying aside money for yourself, since you won't get anything from what you pay now. The only way to end SS as any kind of saving for you working now, is to cut them all off now. That IS what you're talking about if you want to get some gain. If we go by your suggestion, I must say it is noble of you to pay double so that your son or son's son may go back to just paying for himself again.

...or the system could just be tweaked to fit new circumstances.

Peace
Dan

jps176

"let me have mine. i can do better with it over the next 30 years than 2 percent, i guarantee that. if you people seriously think that the stock market will never rebound, you're insane. if you bought the index the day after the big crash in the late 80's, you'd still be up something like 1000% today. if you bought the index now and held it for 30 years....of course no one can predict the future, but the stock market is not a short term proposition, in spite of the flipper, day-trader, microwave, instant gratification culture we've propogated. "

That's precisely why we should not privatize SS... sure you may make out OK on a market return 30 years in the future (maybe again because it is a gamble), but let's say hypothetically it was privatized decades ago. What would be happening to those people who were drawing on market based SS RIGHT NOW? They would not be doing well at all precisely because of the cyclical nature of the market - it would be just more financial disaster we would be dealing with presently. So the point is, why make it a risk when it does not have to be? Instead of adding more overhead in the guise of a profit skim (which would happen with SS being put in the stock market), a non-profit garaunteed set payment amount by the government is a much better and safer idea. Besides, SS is also meant for people who DON'T have any other type of retirement, or income to draw on. 401Ks are market based, and I know people I work with right now who were planning on retiring this year but now can't because of all the free market money they lost in their plans. My 401K is set to do the absolute most conservative investing in can, and I still lost a couple grand... yeah I may have a long way to go before I retire, but with SS being a set amount I know I would get, it's an extra cushion on top of my 401K. But what about people who don't have that? Force them to become market strategists so they might be able to hang on? I believe capitalism is OK, I live in it and benefit from it. But putting all blind faith into "free market solves everything" is a bad idea, just look where that belief has got us now, 30+ years on since Reagan started peddling it. Again, the problem is not how it's set up, it's the fact that Congress just needs to tell well off people they need to start kicking in a little more, like they did all throughout the 20th century before Reagan came along. They'll still do just fine, I'm sure.